German former CEO accused of taking cash

25th September 2006, 0 comments

25 September 2006, MUNICH - A broker was jailed in Germany for four years Monday after testifying that he paid cash kickbacks to Ulrich Schumacher, a former chief executive of the semiconductor manufacturer Infineon. Schumacher, who has not been charged, issued a statement denying that he was given 300,000 dollars in 2003 and more than 50,000 euros (about 60,000 dollars) in 2002, as claimed by the broker. Shares in Infineon, one of Germany's DAX-30 most-traded corporations, blipped two years ago, after Sch

25 September 2006

MUNICH - A broker was jailed in Germany for four years Monday after testifying that he paid cash kickbacks to Ulrich Schumacher, a former chief executive of the semiconductor manufacturer Infineon.

Schumacher, who has not been charged, issued a statement denying that he was given 300,000 dollars in 2003 and more than 50,000 euros (about 60,000 dollars) in 2002, as claimed by the broker.

Shares in Infineon, one of Germany's DAX-30 most-traded corporations, blipped two years ago, after Schumacher lost his job in March 2004, but his management record is now history. The stock was steady Monday, trading in Frankfurt at 8.86 euros.

A Munich court handed a four-year bribery term to Udo Schneider, who brokered corporate sponsorship deals for motor racing, saying the sentence had been reduced in return for his detailed testimony.

Schneider said some of Infineon's promotional spending on major motor races effectively ended with Schumacher and another executive, who raced cars as a hobby. Infineon said in Munich it would study whether it could sue Schumacher to recover the funds.

Germany has stepped up efforts in recent years to stop corporate influence peddling. Schumacher had not been named in pre-trial testimony, although he had been under investigation.

Infineon, which has main offices in Germany, California, Singapore and Japan, has annual sales of 6.7 billion euros (8.5 billion dollars), supplying chips to the automotive and telecoms industries.

Another former Infineon executive, Andreas von Zitzewitz, has admitted taking bribes. The accused told the Munich court the payments were to reimburse the two car-loving executives' entry fees for motor races.

"I wanted to get more business from Infineon," Schneider said in explanation.